Russia-US: a bit of Cold War and a lot of economic crisis

What is going to happen in the US-Russia relations when president-elect Obama takes his oath of office? This question is obviously too large to be properly addressed in a short column. But I have just one observation which I thought I’d share with the readers of this blog.

I can not help but wonder how mixed is Moscow’s perception of, and foreign policy conduct vis-à-vis the US. On the one hand, the Kremlin keeps reproaching the US making big troubles such as the global economic crisis, instability in the Middle East, unilateralism, and double standards. Take for example the issue of the planned the US anti-missile shield in Central Europe. Russia has devoted significant part of its diplomacy arguing against this measure. Recently president Medvedev announced that Russia will deploy its own anti-missile system in Kaliningrad to counter-balance the US. Another example is the global financial meltdown which in Russia’s official parlance has until recently been called the “US economic crisis”. On several occasions Moscow in fact accused the US of initiating the crisis and effectively putting the global economic system at risk. Inside Russia, a negative stance towards the US has become a common place with TV programs devoted to explaining 9/11 as the conspiracy of US secret service. Indeed, in recent years the US-Russia relations have deteriorated to such a degree that some observers called the situation a new Cold War.

At the same time, Moscow’s seeming anti-US position reveals just how it depends on the US. Interestingly, Medvedev’s statement on Kaliningrad was part of his address to the nation delivered on the day following the US election. During his campaign, Obama did not make it clear whether his administration would go forward with the defence plan raising concerns in Poland and Czech Republic that the plan might be shelved. Moscow’s decision to deploy the Iskander system could be interpreted as a reminder to the new US president that there is a rhetorical petite Cold War going on between Russia and the US and that Moscow is ready to continue to play the game. If the US amends the plan, the Kremlin will proudly put it on its scoreboard. If Obama goes ahead with the defense plan, the Kremlin will use this to its advantage, claiming that the new administration is no different in its unilateral, uncompromising and self-centered approach in international relations as its predecessor.

By criticizing the US and exploiting the general dissatisfaction with Bush’s diplomacy in the world, Russia’s diplomats appear to have been achieving remarkable success. Indeed, Russia’s ability to make alliances in Europe with its new proposal for European security was to a great degree dependent on the growing feeling of alienation between Europe and the US that has emerged after the war in Iraq. In this regard, the “new Cold War” is as much a product of the Kremlin as it is of the White House in terms of how the US international behavior is perceived. This is something that often goes unnoticed but should be definitely considered when Russia-Europe-US relations are discussed.

Yet, there is one twist here. As long as the US remains an economic superpower, money will always come ahead of politics. As Obama unveiled his plans to battle that “US economic crisis”, Russia’s main stock indices went up slightly, reversing the dramatic plunge they made in recent weeks. Well, given the rhetorical new Cold war that we have been having for some time, the economic crisis is a change and a “reality check” of sorts, if not a particularly welcomed one.

For many it probably boils down to one question: what will the current global financial meltdown do to the Russian economy, will it make it (the russian economy) more open, resilent after the crisis or will it make it more closed and protectionist? In its turn, the answer(s) to these questions could probably shed a better light on what Russia's Foreign Policy might be in the future.

The signals are mixed at the moment: from voices (within Russia) to ease off the visa regime with other countries, and PM Putin's assurances to such "big guns" as E.ON. about the continuation of Russian economic reforms to prolongation of presidenial terms and the advance of state capitalism. If the leadership is innovative there is little wrong with extending the presidential term, if not, then it becomes a burden for all.

The current crisis and the slowdown of the Russian economy also makes it more interesting to look at major Russian oligarchs in their entirety as their behavior could shed more light on the behaviour of the current Russian political elite due to multiple linkages or similar thinking patterns.